In a deal valued at approximately $1.28 billion, AZZ Inc. acquired the St. Louis, Mo.-based Precoat Metals division of Sequa Corporation. Publicly-traded AZZ is a global provider of metal coating services and the highly complementary acquisition was its largest to date. The deal significantly bolstered AZZ’s position in the industry.

At the time of the acquisition in May of 2022, Sequa was a portfolio company of the Carlyle Group. Private equity firm Veritas Capital acquired the remainder of Sequa, whose sole subsidiary Chromalloy specializes in aircraft engines and gas turbines, from Carlyle in the fourth quarter of 2022. Carlyle acquired Sequa for $2.7 billion in 2007.

Strategic Fit

Through this transaction, AZZ continues to move the needle in transitioning from a diverse holding company to a focused provider of coating and galvanizing services for critical applications, a market the company sees as rich with opportunities and sustainable growth.

“Through this acquisition, AZZ significantly broadens our metal coatings offering, creating unrivaled scale and breadth of solutions in both the pre-painted and post-fabrication coatings markets,” Tom Ferguson, CEO of AZZ, said in a statement when the deal was announced. “We believe the coil coating market will provide sustainable future growth for AZZ and we intend to provide Precoat with the financial resources to expand and further invest in commercial and operational excellence.”

AZZ , which is headquartered in Fort Worth, Texas, funded the deal with a combination of cash on hand, newly issued debt financing and the issuance of equity or equity-linked securities. The transaction moved quickly and had many moving parts, including a buy-side representations and warranties policy.

For more Deals of the Year coverage, see Mergers and Acquisitions Names the 2023 Middle-Market Deals of the Year.